Claremont council takes next step in acquiring Golden State Water Company

CLAREMONT - Council members have taken another step in their effort to acquire local assets of Golden State Water Co.

The City Council on Tuesday approved the hiring of experts and consultants to proceed with the possible purchase of the holdings, despite Golden State Water officials saying they were not for sale.

"It is disappointing that city officials are prepared to continue spending hundreds of thousands of taxpayer dollars that can be better directed elsewhere," said Denise L. Kruger, senior vice president of regulated utilities for Golden State Water Co.

The San Dimas-based company has already declined Claremont's initial offer to purchase the local assets for more than $54 million in November.

Kruger reiterated Wednesday that the company was not for sale.

City officials have long been at odds with the water company after it asked the Public Utilities Commission to approve a rate increase of more than 24 percent in 2013 and additional increases in 2014 and 2015.

A negotiated settlement resulted in Claremont's 11,000 customers and ratepayers receiving a 15.1 percent rate increase in 2013, 2 percent more in 2014 and 1.8 percent in 2015.

Claremont officials are expected to soon meet with Golden State Water representatives, City Manager Tony Ramos said.

Council members have also considered obtaining the assets through eminent domain.

Council members on Tuesday unanimously allocated $300,000 from an unassigned general fund balance to the Water System Acquisition Reserve, which now has a $600,000 reserve balance.

Besides the hiring of experts, a consent calender approved Tuesday by council members also:

- Authorized Ramos to contract a California Environmental Quality Act consultant to prepare environmental documentation that would allow the city to acquire and operate the water system as well as appropriate $150,000 from the Water System Acquisition Fund to fund the contract.

- Set aside up to $150,000 to pay a consultant.

- Authorized Ramos to contract with additional legal counsel, consultants and experts for the city's operation and acquisition of the water system for up to $300,000 from Water System Acquisition Reserve funds.